United States
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (date of earliest event reported):
May 4, 2015
Fidelity National Financial, Inc.
(Exact name of Registrant as Specified in its Charter)
001-32630
(Commission File Number)
Delaware (State or Other Jurisdiction of Incorporation or Organization) | 16-1725106 (IRS Employer Identification Number) | |
601 Riverside Avenue
Jacksonville, Florida 32204
(Addresses of Principal Executive Offices)
(904) 854-8100
(Registrant's Telephone Number, Including Area Code)
(Former Name or Former Address, if Changed Since Last Report)
Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:
o | Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |
o | Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |
o | Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b)) | |
o | Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c)) | |
Item 2.02. | Results of Operations and Financial Condition | |
On May 4, 2015, Fidelity National Financial, Inc. issued an earnings release announcing its financial results for the First Quarter of 2015. The information in this Current Report is being furnished and shall not be deemed “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended or otherwise subject to the liabilities of that Section. The information in this Current Report shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended.
A copy of the FNF Core and FNFV earnings releases are attached as Exhibit 99.1 and Exhibit 99.2, respectively.
Item 9.01. | Financial Statements and Exhibits | |
(c) Exhibits
Exhibit | Description | ||||
99.1 | Press release announcing FNF Core First Quarter 2015 Earnings. | ||||
99.2 | Press release announcing FNFV First Quarter 2015 Earnings. | ||||
SIGNATURE
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.
Fidelity National Financial, Inc. | |||||
Date: | May 4, 2015 | By: | /s/ Anthony J. Park | ||
Name: | Anthony J. Park | ||||
Title: | Chief Financial Officer | ||||
EXHIBIT INDEX
Exhibit | Description | ||||
99.1 | Press release announcing FNF Core First Quarter 2015 Earnings. | ||||
99.2 | Press release announcing FNFV First Quarter 2015 Earnings. | ||||
FNF Core Reports First Quarter 2015 Adjusted EPS of $0.37, Adjusted Pre-Tax Title Margin of 10.3%, Black Knight Organic Revenue Growth of 11% and Adjusted EBITDA Margin of 41.9%Jacksonville, Fla. - (May 4, 2015) - Fidelity National Financial, Inc. today reported the operating results of its core segment (NYSE:FNF), a leading provider of title insurance, technology and transaction services to the real estate and mortgage industries, for the three-month period ended March 31, 2015.
• | Total revenue of approximately $1.6 billion in the first quarter versus $1.4 billion in the first quarter of 2014 |
• | Adjusted first quarter net earnings of $106 million versus adjusted net earnings of $62 million for the first quarter of 2014 |
• | Adjusted first quarter core diluted EPS of $0.37 versus adjusted core diluted EPS of $0.22 in the first quarter of 2014 |
• | First quarter core free cash flow used of $6 million versus $120 million used in the first quarter of 2014 |
Title
• | Approximately $1.4 billion in total revenue, adjusted pre-tax earnings of $140 million and adjusted pre-tax title margin of 10.3% for the first quarter versus approximately $1.2 billion in total revenue, adjusted pre-tax earnings of $66 million and an adjusted pre-tax title margin of 5.5% in the first quarter of 2014 |
• | Adjusted pre-tax title margin of 10.3% was a 480 basis point improvement over the first quarter 2014 adjusted pre-tax title margin of 5.5% |
• | ServiceLink generated $206 million in revenue, adjusted EBITDA of $23 million, an adjusted EBITDA margin of 11%, adjusted pre-tax earnings of $18 million and an adjusted pre-tax margin of 9% for the first quarter |
• | Open orders per day of 9,475 for the first quarter versus 7,689 open orders per day for the first quarter of 2014 |
• | Closed orders per day of 5,656 for the first quarter versus 4,836 closed orders per day for the first quarter of 2014 |
• | First quarter purchase orders opened and closed increased by 8% and 8%, respectively, versus the first quarter of 2014; purchase orders opened and closed increased by 7% and 6%, respectively, versus the first quarter of 2014 excluding ServiceLink default related purchase orders |
• | Total commercial revenue of $213 million, a 22% increase over total commercial revenue in the first quarter of 2014; first quarter national commercial title revenue of $119 million, a 14% increase from the first quarter of 2014, driven by a 5% improvement in the commercial fee per file and a 9% increase in closed orders; open national commercial orders increased by 4% over the prior year |
• | Overall first quarter average fee per file of $1,833, a 1% decrease versus the first quarter of 2014 |
• | Title claims paid of $60 million, a decrease of $7 million, or 10%, from the first quarter of 2014 |
Title Orders
Direct Orders Opened * | Direct Orders Closed * | |||||||
Month | / (% Purchase) | / (% Purchase) | ||||||
January 2015 | 190,000 | 42% | 94,000 | 50% | ||||
February 2015 | 187,000 | 46% | 110,000 | 44% | ||||
March 2015 | 201,000 | 52% | 141,000 | 46% | ||||
First Quarter 2015 | 578,000 | 47% | 345,000 | 46% | ||||
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Direct Orders Opened * | Direct Orders Closed * | |||||||
Month | / (% Purchase) | / (% Purchase) | ||||||
January 2014 | 150,000 | 56% | 99,000 | 51% | ||||
February 2014 | 150,000 | 55% | 92,000 | 47% | ||||
March 2014 | 169,000 | 60% | 104,000 | 58% | ||||
First Quarter 2014 | 469,000 | 57% | 295,000 | 54% | ||||
* Includes an immaterial number of non-purchase and non-refinance orders
Open | Closed | Commercial | |||||||||||||
Commercial | Commercial | Revenue | Commercial | ||||||||||||
Orders* | Orders* | (In millions) | Fee Per File* | ||||||||||||
First Quarter 2015 - Total Commercial | 47,800 | 29,600 | $213 | $7,200 | |||||||||||
First Quarter 2014 - Total Commercial | — | — | $175 | — | |||||||||||
First Quarter 2015 - National Commercial | 20,400 | 11,100 | $119 | $10,700 | |||||||||||
First Quarter 2014 - National Commercial | 19,600 | 10,200 | $104 | $10,200 | |||||||||||
* Total commercial order and fee per file tracking began in January 2015
Black Knight
• | Total revenue of $227 million, led by Servicing Technology revenue of approximately $157 million |
• | Revenue growth of 11% for the first quarter compared to the first quarter of 2014, led by Data & Analytics, RealEC and Origination Technology |
• | Adjusted EBITDA of $96 million and adjusted EBITDA margin of 41.9%, a 750 basis point margin improvement from the first quarter of 2014 |
“This was a great start to the year for both our title insurance and Black Knight businesses,” said Chairman William P. Foley, II. “The significant rate decline in January helped us generate a 63% increase in refinance open orders and a 49% increase in refinance closed orders in the first quarter versus the first quarter of 2014. Additionally, purchase open orders showed improving strength, growing by 12% in February and 10% in March versus the prior year months. Consequently, we were able to achieve a solid 10.3% pre-tax title margin in what is our seasonally weakest quarter of the year. We also believe that we are well positioned to benefit from any continued seasonal improvement in the purchase market as we enter the spring and summer months, with a goal of achieving pre-tax title margins that approach or meet our 15%-20% pre-tax title margin target.
“Black Knight also had a strong start to 2015, generating 11% revenue growth, led by Data & Analytics, RealEC and Origination Technology, and an adjusted EBITDA margin of 41.9%, a 750 basis point margin improvement over the first quarter of 2014. In the first quarter, we started recognizing revenue from a large, multi-year data licensing agreement with a major industry participant and had one month of revenue from a large loan origination technology contract with a large national bank. We are also on track to launch and close the Black Knight initial public offering over the next several weeks and we look forward to Black Knight operating as an FNF majority-owned, publicly-traded company."
Conference Call
We will host a call with investors and analysts to discuss first quarter 2015 FNF Core results on Tuesday, May 5, 2015, beginning at 11:00 a.m. Eastern Time. A live webcast of the conference call will be available on the Events and Multimedia page of the FNF Investor Relations website at www.fnf.com. The conference call replay will be available via webcast through the FNF Investor Relations website at www.fnf.com. The telephone replay will be available from 1:00 p.m. Eastern time on May 5, 2015, through May 12, 2015, by dialing 800-475-6701 (USA) or 320-365-3844 (International). The access code will be 357912.
About FNF
Fidelity National Financial, Inc. (FNF) is organized into two groups, FNF Core (NYSE: FNF) and FNF Ventures (NYSE: FNFV). Through our Core operations, FNF is a leading provider of title insurance, technology and transaction services to the real estate and mortgage industries. FNF is the nation’s largest title insurance company through its title insurance underwriters - Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York - that collectively issue more title insurance policies than any other title company in the United States. FNF also provides industry-leading mortgage technology solutions and transaction services, including MSP®, the leading residential mortgage servicing
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technology platform in the U.S., through its majority-owned subsidiaries, Black Knight Financial Services, LLC and ServiceLink Holdings, LLC. In addition, in our FNFV group, we own majority and minority equity investment stakes in a number of entities, including American Blue Ribbon Holdings, LLC, J. Alexander’s, LLC , Ceridian HCM, Inc., Fleetcor Technologies, Inc. and Digital Insurance, Inc. More information about FNF can be found at www.fnf.com.
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, the Company has provided non-GAAP financial measures, which it believes are useful to help investors better understand its financial performance, competitive position and prospects for the future. These non-GAAP measures include earnings before interest, taxes and depreciation and amortization (EBITDA), adjusted earnings before interest, taxes and depreciation and amortization (Adjusted EBITDA), adjusted earnings before interest, taxes and depreciation as a percent of adjusted revenue (Adjusted EBITDA margin), adjusted net earnings, adjusted EPS and free cash flow.
Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP net earnings. Further, FNF's non-GAAP measures may be calculated differently from similarly titled measures of other companies. Reconciliations of these non-GAAP measures to related GAAP measures are provided below.
Black Knight IPO Information
The proposed Black Knight initial public offering will be made only by means of a prospectus. A copy of the preliminary prospectus may be obtained, when available, from the book-running manager(s) of the proposed offering.
A registration statement on Form S-1 relating to the proposed offering has been filed with the SEC, but has not yet become effective. The shares to be registered may not be sold nor may offers to buy be accepted prior to the time when the registration statement becomes effective. Copies of the registration statement can be accessed through the SEC's website at www.sec.gov. This press release shall not constitute an offer to sell or the solicitation of an offer to buy, nor shall there be any sale of these securities in any state or jurisdiction in which such offer, solicitation or sale would be unlawful prior to registration or qualification under the securities laws of any such state or jurisdiction.
Forward-Looking Statements and Risk Factors
This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. No assurance can be given as to the value of Black Knight's common stock, the price at which its common stock may be offered in the proposed offering, the trading price of such common stock after the proposed offering or whether a liquid market for such common stock will develop or be maintained. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; weakness or adverse changes in the level of real estate activity, which may be caused by, among other things, high or increasing interest rates, a limited supply of mortgage funding or a weak U. S. economy; our potential inability to find suitable acquisition candidates, acquisitions in lines of business that will not necessarily be limited to our traditional areas of focus, or difficulties in integrating acquisitions; our dependence on distributions from our title insurance underwriters as a main source of cash flow; significant competition that our operating subsidiaries face; compliance with extensive government regulation of our operating subsidiaries.
This press release should be read in conjunction with the press release filed for the results of FNFV on this same date as well as the risks detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-Q,10-K and other filings with the Securities and Exchange Commission.
SOURCE: Fidelity National Financial, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President and Treasurer, 904-854-8120, dkmurphy@fnf.com
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FIDELITY NATIONAL FINANCIAL CORE
FIRST QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Three Months Ended | ||||||||||||||||
March 31, 2015 | ||||||||||||||||
Direct title premiums | $ | 417 | $ | 417 | $ | — | $ | — | ||||||||
Agency title premiums | 441 | 441 | — | — | ||||||||||||
Escrow, title related and other fees | 695 | 472 | 227 | (4 | ) | |||||||||||
Total title and escrow | 1,553 | 1,330 | 227 | (4 | ) | |||||||||||
Interest and investment income | 30 | 30 | — | — | ||||||||||||
Total revenue | 1,583 | 1,360 | 227 | (4 | ) | |||||||||||
Personnel costs | 585 | 483 | 97 | 5 | ||||||||||||
Agent commissions | 333 | 333 | — | — | ||||||||||||
Other operating expenses | 372 | 338 | 37 | (3 | ) | |||||||||||
Depreciation and amortization | 83 | 37 | 45 | 1 | ||||||||||||
Claim loss expense | 51 | 51 | — | — | ||||||||||||
Interest expense | 29 | — | 8 | 21 | ||||||||||||
Total expenses | 1,453 | 1,242 | 187 | 24 | ||||||||||||
Pre-tax earnings (loss) from continuing operations | $ | 130 | $ | 118 | $ | 40 | $ | (28 | ) | |||||||
Non-GAAP adjustments before taxes | ||||||||||||||||
Deferred revenue add back and management fee | 3 | — | 3 | — | ||||||||||||
Purchase price amortization | 43 | 22 | 21 | — | ||||||||||||
Total non-GAAP adjustments before taxes | $ | 46 | $ | 22 | $ | 24 | $ | — | ||||||||
Adjusted pre-tax earnings (loss) from continuing ops. | $ | 176 | $ | 140 | $ | 64 | $ | (28 | ) | |||||||
Adjusted pre-tax margin from continuing operations | 11.1 | % | 10.3 | % | 27.9 | % | — | |||||||||
Purchase price amortization | (43 | ) | (22 | ) | (21 | ) | — | |||||||||
Interest expense | 29 | — | 8 | 21 | ||||||||||||
Depreciation and amortization | 83 | 37 | 45 | 1 | ||||||||||||
Adjusted EBITDA | $ | 245 | $ | 155 | $ | 96 | $ | (6 | ) | |||||||
Adjusted EBITDA margin | 15.5 | % | 11.4 | % | 41.9 | % | — | |||||||||
ServiceLink non-GAAP reconciliations: | ||||||||||||||||
ServiceLink pre-tax earnings | $ | — | ||||||||||||||
Depreciation and amortization | 23 | |||||||||||||||
ServiceLink EBITDA | $ | 23 | ||||||||||||||
ServiceLink pre-tax earnings | $ | — | ||||||||||||||
Purchase price amortization | 18 | |||||||||||||||
ServiceLink adjusted pre-tax earnings | $ | 18 | ||||||||||||||
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FIDELITY NATIONAL FINANCIAL CORE
FIRST QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Three Months Ended | ||||||||||||||||
March 31, 2015 | ||||||||||||||||
Pre-tax earnings (loss) from continuing operations | $ | 130 | $ | 118 | $ | 40 | $ | (28 | ) | |||||||
Income tax expense | 47 | 43 | — | 4 | ||||||||||||
Earnings from equity investments | 2 | 2 | — | — | ||||||||||||
Non-controlling interests | (1 | ) | (6 | ) | 5 | — | ||||||||||
Net earnings (loss) attributable to FNF Group common shareholders | $ | 86 | $ | 83 | $ | 35 | $ | (32 | ) | |||||||
EPS attributable to FNF Group common shareholders - basic | $ | 0.31 | $ | 0.30 | $ | 0.13 | $ | (0.12 | ) | |||||||
EPS attributable to FNF Group common shareholders - diluted | $ | 0.30 | $ | 0.29 | $ | 0.12 | $ | (0.11 | ) | |||||||
FNF Group weighted average shares - basic | 278 | |||||||||||||||
FNF Group weighted average shares - diluted | 288 | |||||||||||||||
Net earnings (loss) attributable to FNF Group common shareholders | $ | 86 | $ | 83 | $ | 35 | $ | (32 | ) | |||||||
Total non-GAAP, pre-tax adjustments | 46 | 22 | 24 | — | ||||||||||||
Noncontrolling interest on non-GAAP adjustments | (14 | ) | (6 | ) | (8 | ) | — | |||||||||
Income taxes on non-GAAP adjustments | (12 | ) | (6 | ) | (6 | ) | — | |||||||||
Total non-GAAP adjustments | 20 | 10 | 10 | — | ||||||||||||
Adjusted net earnings (loss) attributable to FNF Group common shareholders | $ | 106 | $ | 93 | $ | 45 | $ | (32 | ) | |||||||
Adjusted EPS attributable to FNF Group common shareholders - diluted | $ | 0.37 | $ | 0.32 | $ | 0.16 | $ | (0.11 | ) | |||||||
Direct orders opened (000's) | 578 | 578 | ||||||||||||||
Direct orders closed (000's) | 345 | 345 | ||||||||||||||
Fee per file | $ | 1,833 | $ | 1,833 | ||||||||||||
Actual title claims paid | $ | 60 | $ | 60 | ||||||||||||
Cash flows provided by operations: | $ | 27 | ||||||||||||||
Non-GAAP adjustments: | ||||||||||||||||
Management fee | 1 | |||||||||||||||
Total non-GAAP adjustments | 1 | |||||||||||||||
Adjusted cash flows from operations | 28 | |||||||||||||||
Capital expenditures | 34 | |||||||||||||||
Free cash flow | $ | (6 | ) | |||||||||||||
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FIDELITY NATIONAL FINANCIAL CORE
FIRST QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Three Months Ended | ||||||||||||||||
March 31, 2014 | ||||||||||||||||
Direct title premiums | $ | 351 | $ | 351 | $ | — | $ | — | ||||||||
Agency title premiums | 404 | 404 | — | — | ||||||||||||
Escrow, title related and other fees | 618 | 422 | 205 | (9 | ) | |||||||||||
Total title and escrow | 1,373 | 1,177 | 205 | (9 | ) | |||||||||||
Interest and investment income | 28 | 28 | — | — | ||||||||||||
Realized gains and losses | 2 | 2 | — | — | ||||||||||||
Total revenue | 1,403 | 1,207 | 205 | (9 | ) | |||||||||||
Personnel costs | 613 | 462 | 144 | 7 | ||||||||||||
Agent commissions | 307 | 307 | — | — | ||||||||||||
Other operating expenses | 399 | 350 | 77 | (28 | ) | |||||||||||
Depreciation and amortization | 101 | 38 | 62 | 1 | ||||||||||||
Claim loss expense | 53 | 53 | — | — | ||||||||||||
Interest expense | 30 | — | 8 | 22 | ||||||||||||
Total expenses | 1,503 | 1,210 | 291 | 2 | ||||||||||||
Pre-tax loss from continuing operations | $ | (100 | ) | $ | (3 | ) | $ | (86 | ) | $ | (11 | ) | ||||
Non-GAAP adjustments before taxes | ||||||||||||||||
Realized (gain) loss, net adjustment | (2 | ) | $ | (2 | ) | — | — | |||||||||
Deferred revenue add back | 4 | — | 4 | — | ||||||||||||
Severance expense | 38 | 14 | 24 | — | ||||||||||||
Synergy accrual | 32 | 13 | 13 | 6 | ||||||||||||
Merger transaction costs | 43 | 22 | 47 | (26 | ) | |||||||||||
Other legal matters | 2 | — | — | 2 | ||||||||||||
Purchase price amortization | 61 | 22 | 39 | — | ||||||||||||
Total non-GAAP adjustments before taxes | $ | 178 | $ | 69 | $ | 127 | $ | (18 | ) | |||||||
Adjusted pre-tax earnings (loss) from continuing operations | $ | 78 | $ | 66 | $ | 41 | $ | (29 | ) | |||||||
Adjusted pre-tax margin from continuing operations | 5.6 | % | 5.5 | % | 19.6 | — | ||||||||||
Purchase price amortization | (61 | ) | (22 | ) | (39 | ) | — | |||||||||
Interest expense | 30 | — | 8 | 22 | ||||||||||||
Depreciation and amortization | 101 | 38 | 62 | 1 | ||||||||||||
Adjusted EBITDA | $ | 148 | $ | 82 | $ | 72 | $ | (6 | ) | |||||||
Adjusted EBITDA margin | 10.5 | % | 6.8 | % | 34.4 | % | — | |||||||||
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FIDELITY NATIONAL FINANCIAL CORE
FIRST QUARTER SEGMENT INFORMATION
(In millions, except order information in thousands)
(Unaudited)
Total FNF Core | Title | BKFS | FNF Core Corporate and Other | |||||||||||||
Three Months Ended | ||||||||||||||||
March 31, 2014 | ||||||||||||||||
Pre-tax loss from continuing operations | $ | (100 | ) | $ | (3 | ) | $ | (86 | ) | $ | (11 | ) | ||||
Income tax (benefit) expense | (37 | ) | 10 | (11 | ) | (36 | ) | |||||||||
Non-controlling interests | (57 | ) | (22 | ) | (35 | ) | — | |||||||||
Net (loss) earnings attributable to Old FNF common shareholders | $ | (6 | ) | $ | 9 | $ | (40 | ) | $ | 25 | ||||||
EPS attributable to Old FNF common shareholders - basic | $ | (0.02 | ) | $ | 0.03 | $ | (0.14 | ) | $ | 0.09 | ||||||
EPS attributable to Old FNF common shareholders - diluted | $ | (0.02 | ) | $ | 0.03 | $ | (0.14 | ) | $ | 0.09 | ||||||
Old FNF weighted average shares - basic | 274 | |||||||||||||||
Old FNF weighted average shares - diluted | 282 | |||||||||||||||
Net (loss) earnings attributable to Old FNF common shareholders | $ | (6 | ) | $ | 9 | $ | (40 | ) | $ | 25 | ||||||
Total non-GAAP, pre-tax adjustments | 178 | 69 | 127 | (18 | ) | |||||||||||
Income taxes on non-GAAP adjustments | (42 | ) | (17 | ) | (32 | ) | 7 | |||||||||
Noncontrolling interest on non-GAAP adjustments | (68 | ) | (24 | ) | (44 | ) | — | |||||||||
Total non-GAAP adjustments | 68 | 28 | 51 | (11 | ) | |||||||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 62 | $ | 37 | $ | 11 | $ | 14 | ||||||||
Adjusted EPS attributable to Old FNF common shareholders - diluted | $ | 0.22 | $ | 0.13 | $ | 0.04 | $ | 0.05 | ||||||||
Direct orders opened (000's) | 469 | 469 | ||||||||||||||
Direct orders closed (000's) | 295 | 295 | ||||||||||||||
Fee per file | $ | 1,858 | $ | 1,858 | ||||||||||||
Actual title claims paid | $ | 67 | $ | 67 | ||||||||||||
Cash flows provided by operations: | $ | (195 | ) | |||||||||||||
Non-GAAP adjustments: | ||||||||||||||||
Transaction costs related to acquisition of LPS | 40 | |||||||||||||||
Severance costs related to acquisition of LPS | 39 | |||||||||||||||
Executive severance payment | 9 | |||||||||||||||
Management fee | 1 | |||||||||||||||
Other legal matters | 2 | |||||||||||||||
Total non-GAAP adjustments | 91 | |||||||||||||||
Adjusted cash flows from operations | (104 | ) | ||||||||||||||
Capital expenditures | 16 | |||||||||||||||
Free cash flow | $ | (120 | ) | |||||||||||||
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FIDELITY NATIONAL FINANCIAL CORE
QUARTERLY OPERATING STATISTICS
(Unaudited)
Q1 2015 | Q4 2014 | Q3 2014 | Q2 2014 | Q1 2014 | Q4 2013 | Q3 2013 | Q2 2013 | |||||||||||||||||||||||||||
Quarterly Open Orders ('000's except % data) | ||||||||||||||||||||||||||||||||||
Total open orders* | 578 | 452 | 481 | 514 | 469 | 391 | 474 | 672 | ||||||||||||||||||||||||||
Total open orders per day* | 9.5 | 7.1 | 7.5 | 8.0 | 7.7 | 6.2 | 7.4 | 10.5 | ||||||||||||||||||||||||||
Purchase % of open orders | 47 | % | 52 | % | 60 | % | 60 | % | 55 | % | 55 | % | 56 | % | 42 | % | ||||||||||||||||||
Refinance % of open orders | 53 | % | 48 | % | 40 | % | 40 | % | 45 | % | 45 | % | 44 | % | 58 | % | ||||||||||||||||||
Total closed orders* | 345 | 334 | 348 | 342 | 295 | 307 | 410 | 504 | ||||||||||||||||||||||||||
Total closed orders per day* | 5.7 | 5.2 | 5.4 | 5.3 | 4.8 | 4.9 | 6.4 | 7.9 | ||||||||||||||||||||||||||
Purchase % of closed orders | 46 | % | 57 | % | 62 | % | 61 | % | 52 | % | 56 | % | 50 | % | 40 | % | ||||||||||||||||||
Refinance % of closed orders | 54 | % | 43 | % | 38 | % | 39 | % | 48 | % | 44 | % | 50 | % | 60 | % | ||||||||||||||||||
Commercial (millions, except orders in '000's) | ||||||||||||||||||||||||||||||||||
Total commercial revenue** | $ | 213 | $ | 274 | $ | 225 | $ | 183 | $ | 175 | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||
Total commercial open orders** | 47.8 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
Total commercial closed orders** | 29.6 | — | — | — | — | — | — | — | ||||||||||||||||||||||||||
National commercial revenue | $ | 119 | $ | 166 | $ | 136 | $ | 115 | $ | 104 | $ | 146 | $ | 120 | $ | 112 | ||||||||||||||||||
National commercial open orders | 20.4 | 18.1 | 21.4 | 22.2 | 19.6 | 19.3 | 19.9 | 20.3 | ||||||||||||||||||||||||||
National commercial closed orders | 11.1 | 12.7 | 12.8 | 11.8 | 10.2 | 12.8 | 12.6 | 12.3 | ||||||||||||||||||||||||||
Total Fee Per File | ||||||||||||||||||||||||||||||||||
Fee per file | $ | 1,833 | $ | 2,131 | $ | 2,066 | $ | 1,982 | $ | 1,858 | $ | 2,082 | $ | 1,807 | $ | 1,562 | ||||||||||||||||||
Residential and local commercial fee per file | $ | 1,538 | $ | 1,699 | $ | 1,739 | $ | 1,750 | $ | 1,559 | $ | 1,676 | $ | 1,562 | $ | 1,373 | ||||||||||||||||||
Residential fee per file | $ | 1,330 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||
Total commercial fee per file** | $ | 7,200 | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | $ | — | ||||||||||||||||||
National commercial fee per file | $ | 10,700 | $ | 13,100 | $ | 10,600 | $ | 9,800 | $ | 10,200 | $ | 11,400 | $ | 9,500 | $ | 9,100 | ||||||||||||||||||
Total Staffing | ||||||||||||||||||||||||||||||||||
Total field operations employees | 10,400 | 9,900 | 10,200 | 10,200 | 10,300 | 9,900 | 10,600 | 12,000 | ||||||||||||||||||||||||||
FNT Only Quarterly Operating Statistics ('000's except fee per file and staffing) | ||||||||||||||||||||||||||||||||||
Total open orders* | 456 | 354 | 385 | 403 | 349 | 331 | 391 | 516 | ||||||||||||||||||||||||||
Total open orders per day* | 7.5 | 5.6 | 6.0 | 6.3 | 5.7 | 5.3 | 6.1 | 8.1 | ||||||||||||||||||||||||||
Purchase % of open orders | 54 | % | 60 | % | 69 | % | 71 | % | 71 | % | 65 | % | 68 | % | 56 | % | ||||||||||||||||||
Refinance % of open orders | 46 | % | 40 | % | 31 | % | 29 | % | 29 | % | 35 | % | 32 | % | 44 | % | ||||||||||||||||||
Total closed orders* | 277 | 273 | 282 | 272 | 219 | 263 | 323 | 387 | ||||||||||||||||||||||||||
Total closed orders per day* | 4.5 | 4.3 | 4.4 | 4.3 | 3.6 | 4.2 | 5.0 | 6.0 | ||||||||||||||||||||||||||
Purchase % of closed orders | 52 | % | 63 | % | 70 | % | 71 | % | 67 | % | 66 | % | 64 | % | 52 | % | ||||||||||||||||||
Refinance % of closed orders | 48 | % | 37 | % | 30 | % | 29 | % | 33 | % | 34 | % | 36 | % | 48 | % | ||||||||||||||||||
Fee per file | 2,055 | 2,382 | 2,306 | 2,227 | 2,151 | 2,260 | 2,028 | 1,747 | ||||||||||||||||||||||||||
Total tile field operations employees | 9,100 | 8,700 | 8,900 | 8,700 | 8,600 | 8,900 | 9,300 | 10,100 | ||||||||||||||||||||||||||
ServiceLink Only Quarterly Operating Statistics ('000's except fee per file and staffing) | ||||||||||||||||||||||||||||||||||
Total Open Orders* | 122 | 98 | 96 | 111 | 120 | 60 | 83 | 156 | ||||||||||||||||||||||||||
Total open orders per day* | 2.0 | 1.6 | 1.5 | 1.7 | 2.0 | 1.0 | 1.3 | 2.4 | ||||||||||||||||||||||||||
Purchase % of open orders | 17 | % | 23 | % | 23 | % | 20 | 7 | — | — | — | |||||||||||||||||||||||
Refinance % of open orders | 83 | % | 77 | % | 77 | % | 80 | % | 93 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||||||
Total closed orders | 68 | 61 | 66 | 70 | 76 | 44 | 87 | 117 | ||||||||||||||||||||||||||
Total closed orders per day* | 1.1 | 1.0 | 1.0 | 1.1 | 1.2 | 0.7 | 1.4 | 1.8 | ||||||||||||||||||||||||||
Purchase % of closed orders | 22 | % | 26 | % | 24 | % | 18 | 6 | — | — | — | |||||||||||||||||||||||
Refinance % of closed orders | 78 | % | 74 | % | 76 | % | 82 | % | 94 | % | 100 | % | 100 | % | 100 | % | ||||||||||||||||||
Fee per file | 921 | 1,027 | 1,052 | 1,038 | 1,009 | 1,013 | 989 | 951 | ||||||||||||||||||||||||||
Total ServiceLink operating employees | 1,300 | 1,200 | 1,300 | 1,500 | 1,700 | 970 | 1,300 | 1,900 | ||||||||||||||||||||||||||
* Includes an immaterial number of non-purchase and non-refinance orders
** Total commercial order and fee per file tracking began in January 2015
8
FIDELITY NATIONAL FINANCIAL CORE
SUMMARY BALANCE SHEET INFORMATION
(In millions)
FNF Core March 31, 2015 | FNF Core December 31, 2014 | |||||||||
(Unaudited) | (Unaudited) | |||||||||
Cash and investment portfolio | $ | 4,325 | $ | 4,360 | ||||||
Goodwill | 4,518 | 4,514 | ||||||||
Title plant | 393 | 393 | ||||||||
Total assets | 11,972 | 11,944 | ||||||||
Notes payable | 2,703 | 2,702 | ||||||||
Reserve for title claim losses | 1,612 | 1,621 | ||||||||
Secured trust deposits | 667 | 622 | ||||||||
Redeemable non-controlling interests | 724 | 715 | ||||||||
Non-redeemable non-controlling interests | (69 | ) | (58 | ) | ||||||
Total equity and redeemable non-controlling interests | 5,329 | 5,272 | ||||||||
Total equity attributable to common shareholders | 4,674 | 4,615 | ||||||||
FNF Core March 31, 2015 | FNFV March 31, 2015 | Consolidated March 31, 2015 | Consolidated December 31, 2014 | |||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | ||||||||||||||||||
Cash and investment portfolio | $ | 4,325 | $ | 926 | $ | 5,251 | $ | 5,369 | ||||||||||||
Goodwill | 4,518 | 194 | 4,712 | 4,721 | ||||||||||||||||
Title plant | 393 | — | 393 | 393 | ||||||||||||||||
Total assets | 11,972 | 1,749 | 13,721 | 13,868 | ||||||||||||||||
Notes payable | 2,703 | 203 | 2,906 | 2,827 | ||||||||||||||||
Reserve for title claim losses | 1,612 | — | 1,612 | 1,621 | ||||||||||||||||
Secured trust deposits | 667 | — | 667 | 622 | ||||||||||||||||
Redeemable non-controlling interests | 724 | — | 724 | 715 | ||||||||||||||||
Non-redeemable non-controlling interests | (69 | ) | 126 | 57 | 79 | |||||||||||||||
Total equity and redeemable non-controlling interests | 5,329 | 1,302 | 6,631 | 6,788 | ||||||||||||||||
Total equity attributable to common shareholders | 4,674 | 1,176 | 5,850 | 5,994 | ||||||||||||||||
9
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | |||||||||||
March 31, 2015 | |||||||||||
Consolidated | Core | FNFV | |||||||||
Direct title premiums | $ | 417 | $ | 417 | $ | — | |||||
Agency title premiums | 441 | 441 | — | ||||||||
Total title premiums | 858 | 858 | — | ||||||||
Escrow, title-related and other fees | 808 | 695 | 113 | ||||||||
Total title and escrow and other | 1,666 | 1,553 | 113 | ||||||||
Restaurant revenue | 364 | — | 364 | ||||||||
Interest and investment income | 31 | 30 | 1 | ||||||||
Total revenue | 2,061 | 1,583 | 478 | ||||||||
Personnel costs | 623 | 585 | 38 | ||||||||
Other operating expenses | 466 | 372 | 94 | ||||||||
Cost of restaurant revenue | 306 | — | 306 | ||||||||
Agent commissions | 333 | 333 | — | ||||||||
Depreciation and amortization | 100 | 83 | 17 | ||||||||
Title claim loss expense | 51 | 51 | — | ||||||||
Interest expense | 31 | 29 | 2 | ||||||||
Total expenses | 1,910 | 1,453 | 457 | ||||||||
Earnings from continuing operations before taxes | 151 | 130 | 21 | ||||||||
Income tax expense | 50 | 47 | 3 | ||||||||
Earnings from continuing operations before equity investments | 101 | 83 | 18 | ||||||||
(Loss) earnings from equity investments | (1 | ) | 2 | (3 | ) | ||||||
Net earnings | 100 | 85 | 15 | ||||||||
Non-controlling interests | 14 | (1 | ) | 15 | |||||||
Net earnings attributable to common shareholders | $ | 86 | $ | 86 | $ | — | |||||
Cash flows provided by operations | 34 | 27 | 7 | ||||||||
10
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | |||||||||||
March 31, 2014 | |||||||||||
Consolidated | Core | FNFV | |||||||||
Direct title premiums | $ | 351 | $ | 351 | $ | — | |||||
Agency title premiums | 404 | 404 | — | ||||||||
Total title premiums | 755 | 755 | — | ||||||||
Escrow, title-related and other fees | 646 | 618 | 28 | ||||||||
Total title and escrow and other | 1,401 | 1,373 | 28 | ||||||||
Restaurant revenue | 354 | — | 354 | ||||||||
Interest and investment income | 29 | 28 | 1 | ||||||||
Realized gains and losses | 2 | 2 | — | ||||||||
Total revenue | 1,786 | 1,403 | 383 | ||||||||
Personnel costs | 649 | 613 | 36 | ||||||||
Other operating expenses | 418 | 399 | 19 | ||||||||
Cost of restaurant revenue | 300 | — | 300 | ||||||||
Agent commissions | 307 | 307 | — | ||||||||
Depreciation and amortization | 117 | 101 | 16 | ||||||||
Title claim loss expense | 53 | 53 | — | ||||||||
Interest expense | 31 | 30 | 1 | ||||||||
Total expenses | 1,875 | 1,503 | 372 | ||||||||
(Loss) earnings from continuing operations before taxes | (89 | ) | (100 | ) | 11 | ||||||
Income tax benefit | (40 | ) | (37 | ) | (3 | ) | |||||
(Loss) earnings from continuing operations before equity investments | (49 | ) | (63 | ) | 14 | ||||||
Loss from equity investments | (31 | ) | — | (31 | ) | ||||||
Net loss from continuing operations | (80 | ) | (63 | ) | (17 | ) | |||||
Earnings from discontinued operations, net of tax | 7 | — | 7 | ||||||||
Net loss | (73 | ) | (63 | ) | (10 | ) | |||||
Non-controlling interests | (51 | ) | (57 | ) | 6 | ||||||
Net loss attributable to common shareholders | $ | (22 | ) | $ | (6 | ) | $ | (16 | ) | ||
Cash flows used in operations | (242 | ) | (195 | ) | (47 | ) | |||||
###
11
FNFV Reports First Quarter 2015 Results With Completion of Several Monetization Efforts and $1.2 Billion Book Value of Portfolio Company Investments, or $14.69 Per Share Jacksonville, Fla. -- (May 4, 2015) -- FNFV (NYSE:FNFV), a tracking stock established to highlight the inherent value of the portfolio companies of Fidelity National Financial, Inc. (NYSE:FNF), today reported operating results for the three-month period ended March 31, 2015.
• | Total revenue of $478 million in the first quarter versus $383 million in the first quarter of 2014 |
• | First quarter adjusted diluted EPS of $0.03 versus adjusted diluted EPS of $0.03 in the first quarter of 2014 |
• | Adjusted EBITDA of $40 million for the first quarter versus adjusted EBITDA of $28 million for the first quarter of 2014 |
• | First quarter FNFV free cash flow used of $3 million versus $59 million used in the first quarter of 2014 |
• | $110 million in holding company cash on March 31, 2015 |
Restaurant Group
• | $364 million in total revenue, adjusted EBITDA of $25 million and adjusted EBITDA margin of 6.9% for the first quarter versus approximately $354 million in total revenue, adjusted EBITDA of $24 million and an adjusted EBITDA margin of 6.8% in the first quarter of 2014 |
• | American Blue Ribbon Holdings generated $308 million in total revenue and adjusted EBITDA of nearly $18 million; same store sales increased approximately 2.4% in the first quarter, with Ninety Nine and Bakers Square leading the way at 7% and 5%, respectively; O'Charley's and Village Inn both also had positive same stores sale at 1% and 2%, respectively |
• | J. Alexander's produced $56 million in total revenue and adjusted EBITDA of nearly $8 million; same store sales growth was approximately 6% at both the J. Alexander's and Stoney River concepts in the first quarter |
Ceridian HCM
• | First quarter total revenue of approximately $208 million, a 5% decline from the first quarter of 2014, a pre-tax loss of $6 million, EBITDA of more than $30 million and an EBITDA margin of more than 14% |
Digital Insurance
• | First quarter total revenue of $28 million, a 24% increase over the first quarter of 2014; pre-tax earnings of more than $1 million, EBITDA of nearly $7 million, a 22% increase over the first quarter of 2014, and a first quarter EBITDA margin of more than 23% |
Monetization Initiatives
• | Closed sale of Cascade Timberlands to Whitefish Cascade Forest Resources on February 18, 2015; FNFV received a total cash distribution of approximately $63 million from Cascade Timberlands at closing |
• | Completed the modified Dutch auction tender for the purchase of $185 million of FNFV common stock on March 20, 2015; repurchased a total of 12.3 million shares of FNFV common stock for $15.00 per share |
• | Received $80 million from Digital Insurance on March 31, 2015, as full repayment of principal and interest on the loan between FNFV and Digital Insurance |
“We again completed several monetization events during the quarter at FNFV,” said Chairman William P. Foley, II. “We were excited to monetize the value of Cascade for our shareholders as we had been owners of Cascade for approximately eight years and felt it was in the best interest of our shareholders to seek another use for this cash in hopes of maximizing the value of our FNFV assets. We used the $63 million cash distribution from Cascade to partially fund the $185 million modified Dutch tender offer in March, repurchasing a total of approximately 12.3 million shares at a price $15.00 per share. Finally, we received $80 million as full repayment of our loan with Digital Insurance, as they were able to secure a standalone credit facility with a group of banks. As we move through 2015 and beyond, we will continue to seek strategies to most efficiently monetize our existing investments in hopes of maximizing the value of each for the benefit of our FNFV shareholders."
Conference Call
We will host a call with investors and analysts to discuss first quarter 2015 results of FNFV on Tuesday, May 5, 2015, beginning at 12:00 p.m. Eastern Time. A live webcast of the conference call will be available on the Events and Multimedia
1
page of the FNF Investor Relations website at www.fnf.com. The conference call replay will be available via webcast through the FNF Investor Relations website at www.fnf.com. The telephone replay will be available from 2:00 p.m. Eastern time on May 5, 2015, through May 12, 2015, by dialing 800-475-6701 (USA) or 320-365-3844 (International). The access code will be 357916.
About FNF
Fidelity National Financial, Inc. (FNF) is organized into two groups, FNF Core (NYSE: FNF) and FNF Ventures (NYSE: FNFV). Through our Core operations, FNF is a leading provider of title insurance, technology and transaction services to the real estate and mortgage industries. FNF is the nation’s largest title insurance company through its title insurance underwriters - Fidelity National Title, Chicago Title, Commonwealth Land Title, Alamo Title and National Title of New York - that collectively issue more title insurance policies than any other title company in the United States. FNF also provides industry-leading mortgage technology solutions and transaction services, including MSP®, the leading residential mortgage servicing technology platform in the U.S., through its majority-owned subsidiaries, Black Knight Financial Services, LLC and ServiceLink Holdings, LLC. In addition, in our FNFV group, we own majority and minority equity investment stakes in a number of entities, including American Blue Ribbon Holdings, LLC, J. Alexander’s, LLC, Ceridian HCM, Inc., Fleetcor Technologies, Inc. and Digital Insurance, Inc. More information about FNF can be found at www.fnf.com.
Use of Non-GAAP Financial Information
Generally Accepted Accounting Principles (GAAP) is the term used to refer to the standard framework of guidelines for financial accounting. GAAP includes the standards, conventions, and rules accountants follow in recording and summarizing transactions and in the preparation of financial statements. In addition to reporting financial results in accordance with GAAP, the Company has provided non-GAAP financial measures, which it believes are useful to help investors better understand its financial performance, competitive position and prospects for the future. These non-GAAP measures include earnings before interest, taxes and depreciation and amortization (EBITDA), adjusted earnings before interest, taxes and depreciation and amortization (Adjusted EBITDA), adjusted earnings before interest, taxes and depreciation as a percent of adjusted revenue (Adjusted EBITDA margin), adjusted net earnings, adjusted EPS and free cash flow.
Any non-GAAP measures should be considered in context with the GAAP financial presentation and should not be considered in isolation or as a substitute for GAAP net earnings. Further, FNF's non-GAAP measures may be calculated differently from similarly titled measures of other companies. Reconciliations of these non-GAAP measures to related GAAP measures are provided below.
Forward-Looking Statements and Risk Factors
This press release contains forward-looking statements that involve a number of risks and uncertainties. Statements that are not historical facts, including statements regarding our expectations, hopes, intentions or strategies regarding the future are forward-looking statements. Forward-looking statements are based on management's beliefs, as well as assumptions made by, and information currently available to, management. Because such statements are based on expectations as to future financial and operating results and are not statements of fact, actual results may differ materially from those projected. We undertake no obligation to update any forward-looking statements, whether as a result of new information, future events or otherwise. The risks and uncertainties which forward-looking statements are subject to include, but are not limited to: changes in general economic, business and political conditions, including changes in the financial markets; weakness or adverse changes in the level of real estate activity, which may be caused by, among other things, high or increasing interest rates, a limited supply of mortgage funding or a weak U. S. economy; our potential inability to find suitable acquisition candidates, acquisitions in lines of business that will not necessarily be limited to our traditional areas of focus, or difficulties in integrating acquisitions; our dependence on distributions from our title insurance underwriters as a main source of cash flow; significant competition that our operating subsidiaries face; compliance with extensive government regulation of our operating subsidiaries.
This press release should be read in conjunction with the press release filed for the results of FNF on this same date as well as the risks detailed in the “Statement Regarding Forward-Looking Information,” “Risk Factors” and other sections of the Company’s Form 10-Q,10-K and other filings with the Securities and Exchange Commission.
SOURCE: Fidelity National Financial, Inc.
CONTACT: Daniel Kennedy Murphy, Senior Vice President and Treasurer, 904-854-8120, dkmurphy@fnf.com
2
FIDELITY NATIONAL FINANCIAL VENTURES
FIRST QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
March 31, 2015 | ||||||||||||
Operating revenue | $ | 477 | $ | 364 | $ | 113 | ||||||
Interest and investment income | 1 | — | 1 | |||||||||
Total revenue | 478 | 364 | 114 | |||||||||
Personnel costs | 38 | 17 | 21 | |||||||||
Other operating expenses | 94 | 16 | 78 | |||||||||
Cost of restaurant revenue | 306 | 306 | — | |||||||||
Depreciation and amortization | 17 | 13 | 4 | |||||||||
Interest expense | 2 | 2 | — | |||||||||
Total expenses | 457 | 354 | 103 | |||||||||
Pre-tax earnings from continuing operations | $ | 21 | $ | 10 | $ | 11 | ||||||
Non-GAAP adjustments before taxes | ||||||||||||
Purchase price amortization | 7 | 4 | 3 | |||||||||
Total non-GAAP adjustments before taxes | $ | 7 | $ | 4 | $ | 3 | ||||||
Adjusted pre-tax earnings from continuing operations | $ | 28 | $ | 14 | $ | 14 | ||||||
Adjusted pre-tax margin from continuing operations | 5.9 | % | 3.8 | % | 12.3 | % | ||||||
Purchase price amortization | (7 | ) | (4 | ) | (3 | ) | ||||||
Interest expense | 2 | 2 | — | |||||||||
Depreciation and amortization | (17 | ) | (13 | ) | (4 | ) | ||||||
Adjusted EBITDA | $ | 40 | $ | 25 | $ | 15 | ||||||
Adjusted EBITDA margin | 8.4 | % | 6.9 | % | 13.2 | % | ||||||
3
FIDELITY NATIONAL FINANCIAL VENTURES
FIRST QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
March 31, 2015 | ||||||||||||
Pre-tax earnings from continuing operations | $ | 21 | $ | 10 | $ | 11 | ||||||
Income tax expense | 3 | — | 3 | |||||||||
Earnings from equity investments | (3 | ) | — | (3 | ) | |||||||
Non-controlling interests | 15 | 3 | 12 | |||||||||
Net earnings (loss) attributable to FNFV common shareholders | $ | — | $ | 7 | $ | (7 | ) | |||||
EPS attributable to FNFV common shareholders - basic | $ | — | $ | 0.08 | $ | (0.08 | ) | |||||
EPS attributable to FNFV common shareholders - diluted | $ | — | $ | 0.08 | $ | (0.08 | ) | |||||
FNFV weighted average shares - basic | 90 | |||||||||||
FNFV weighted average shares - diluted | 92 | |||||||||||
Net earnings (loss) attributable to FNFV common shareholders | $ | — | $ | 7 | $ | (7 | ) | |||||
Total non-GAAP, pre-tax adjustments | $ | 7 | $ | 4 | $ | 3 | ||||||
Income taxes on non-GAAP adjustments | (2 | ) | (1 | ) | (1 | ) | ||||||
Noncontrolling interest on non-GAAP adjustments | (2 | ) | (2 | ) | — | |||||||
Total non-GAAP adjustments | 3 | 1 | 2 | |||||||||
Adjusted net earnings (loss) attributable to FNFV common shareholders | $ | 3 | $ | 8 | $ | (5 | ) | |||||
Adjusted EPS attributable to FNFV common shareholders - diluted | $ | 0.03 | $ | 0.09 | $ | (0.06 | ) | |||||
Cash flows provided by operations: | $ | 7 | ||||||||||
Capital expenditures | 10 | |||||||||||
Free cash flow | $ | (3 | ) | |||||||||
4
FIDELITY NATIONAL FINANCIAL VENTURES
FIRST QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
March 31, 2014 | ||||||||||||
Operating revenue | $ | 382 | $ | 354 | $ | 28 | ||||||
Interest and investment income | 1 | — | 1 | |||||||||
Total revenue | 383 | 354 | 29 | |||||||||
Personnel costs | 36 | 16 | 20 | |||||||||
Other operating expenses | 19 | 14 | 5 | |||||||||
Cost of restaurant revenue | 300 | 300 | — | |||||||||
Depreciation and amortization | 16 | 13 | 3 | |||||||||
Interest expense | 1 | 2 | (1 | ) | ||||||||
Total expenses | 372 | 345 | 27 | |||||||||
Pre-tax earnings from continuing operations | $ | 11 | $ | 9 | $ | 2 | ||||||
Non-GAAP adjustments before taxes | ||||||||||||
Purchase price amortization | 6 | 4 | 2 | |||||||||
Total non-GAAP adjustments before taxes | $ | 6 | $ | 4 | $ | 2 | ||||||
Adjusted pre-tax earnings from continuing operations | $ | 17 | $ | 13 | $ | 4 | ||||||
Adjusted pre-tax margin from continuing operations | 4.4 | % | 3.7 | % | 13.8 | % | ||||||
Purchase price amortization | (6 | ) | (4 | ) | (2 | ) | ||||||
Interest expense | 1 | 2 | (1 | ) | ||||||||
Depreciation and amortization | 16 | 13 | 3 | |||||||||
Adjusted EBITDA | $ | 28 | $ | 24 | $ | 4 | ||||||
Adjusted EBITDA margin | 7.3 | % | 6.8 | % | 13.8 | % | ||||||
5
FIDELITY NATIONAL FINANCIAL VENTURES
FIRST QUARTER SEGMENT INFORMATION
(In millions)
(Unaudited)
Total FNFV | Restaurant Group | FNFV Corporate and Other | ||||||||||
Three Months Ended | ||||||||||||
March 31, 2014 | ||||||||||||
Pre-tax earnings from continuing operations | $ | 11 | $ | 9 | $ | 2 | ||||||
Income tax benefit | (3 | ) | — | (3 | ) | |||||||
Loss from equity investments | (31 | ) | — | (31 | ) | |||||||
Earnings from discontinued operations, net of tax | 7 | — | 7 | |||||||||
Non-controlling interests | 6 | 3 | 3 | |||||||||
Net (loss) earnings attributable to Old FNF common shareholders | $ | (16 | ) | $ | 6 | $ | (22 | ) | ||||
EPS attributable to Old FNF common shareholders - basic | $ | (0.06 | ) | $ | 0.02 | $ | (0.08 | ) | ||||
EPS attributable to Old FNF common shareholders - diluted | $ | (0.06 | ) | $ | 0.02 | $ | (0.08 | ) | ||||
Old FNF weighted average shares - basic | 274 | |||||||||||
Old FNF weighted average shares - diluted | 282 | |||||||||||
Net (loss) earnings attributable to Old FNF common shareholders | $ | (16 | ) | $ | 6 | $ | (22 | ) | ||||
Total non-GAAP, pre-tax adjustments | $ | 6 | $ | 4 | $ | 2 | ||||||
Ceridian truck stop settlement | 34 | — | 34 | |||||||||
Income taxes on non-GAAP adjustments | (13 | ) | (1 | ) | (12 | ) | ||||||
Noncontrolling interest on non-GAAP adjustments | (2 | ) | (2 | ) | — | |||||||
Total non-GAAP adjustments | 25 | 1 | 24 | |||||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 9 | $ | 7 | $ | 2 | ||||||
Adjusted EPS attributable to Old FNF common shareholders - diluted | $ | 0.03 | $ | 0.03 | $ | — | ||||||
Adjusted net earnings attributable to Old FNF common shareholders | $ | 9 | $ | 7 | $ | 2 | ||||||
Earnings from discontinued operations, net of tax | (7 | ) | — | (7 | ) | |||||||
Non-controlling interests on discontinued operations | 3 | — | 3 | |||||||||
Adjusted net earnings (loss) from continuing operations attributable to Old FNF common shareholders | $ | 5 | $ | 7 | $ | (2 | ) | |||||
Adjusted EPS from continuing operations attributable to Old FNF common shareholders - diluted | $ | 0.02 | $ | 0.03 | $ | (0.01 | ) | |||||
Cash flows used by operations: | $ | (47 | ) | |||||||||
Capital expenditures | 12 | |||||||||||
Free cash flow | $ | (59 | ) | |||||||||
6
FIDELITY NATIONAL FINANCIAL VENTURES
SUMMARY BALANCE SHEET AND BOOK VALUE SUMMARY
(In millions)
FNFV March 31, 2015 | FNFV December 31, 2014 | |||||||||
(Unaudited) | (Unaudited) | |||||||||
Cash and investment portfolio | $ | 926 | $ | 1,009 | ||||||
Goodwill | 194 | 206 | ||||||||
Total assets | 1,749 | 1,923 | ||||||||
Notes payable | 203 | 124 | ||||||||
Non-controlling interest | 126 | 137 | ||||||||
Total equity and redeemable non-controlling interests | 1,302 | 1,515 | ||||||||
Total equity attributable to common shareholders | 1,176 | 1,378 | ||||||||
FNF Core | FNFV | Consolidated March 31, 2015 | Consolidated December 31, 2014 | ||||||||||||||||||
(Unaudited) | (Unaudited) | (Unaudited) | |||||||||||||||||||
Cash and investment portfolio | $ | 4,325 | $ | 926 | $ | 5,251 | $ | 5,369 | |||||||||||||
Goodwill | 4,518 | 194 | 4,712 | 4,721 | |||||||||||||||||
Title plant | 393 | — | 393 | 393 | |||||||||||||||||
Total assets | 11,972 | 1,749 | 13,721 | 13,868 | |||||||||||||||||
Notes payable | 2,703 | 203 | 2,906 | 2,827 | |||||||||||||||||
Reserve for title claim losses | 1,612 | — | 1,612 | 1,621 | |||||||||||||||||
Secured trust deposits | 667 | — | 667 | 622 | |||||||||||||||||
Redeemable non-controlling interests | 724 | — | 724 | 715 | |||||||||||||||||
Non-redeemable non-controlling interests | (69 | ) | 126 | 57 | 79 | ||||||||||||||||
Total equity and redeemable non-controlling interests | 5,329 | 1,302 | 6,631 | 6,788 | |||||||||||||||||
Total equity attributable to common shareholders | 4,674 | 1,176 | 5,850 | 5,994 | |||||||||||||||||
Book Value Summary | FNFV March 31, 2015 | FNFV December 31, 2014 | |||||||
Book Value | Book Value | ||||||||
(Unaudited) | (Unaudited) | ||||||||
Ceridian/Fleetcor | $ | 627 | $ | 632 | |||||
American Blue Ribbon Holdings | 168 | 159 | |||||||
J. Alexander's | 95 | 100 | |||||||
Digital Insurance | 71 | 149 | |||||||
Cascade | — | 63 | |||||||
Holding Company Cash | 110 | 164 | |||||||
Other | 105 | 111 | |||||||
FNFV Book Value | $ | 1,176 | $ | 1,378 | |||||
7
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | |||||||||||
March 31, 2015 | |||||||||||
Consolidated | Core | FNFV | |||||||||
Direct title premiums | $ | 417 | $ | 417 | $ | — | |||||
Agency title premiums | 441 | 441 | — | ||||||||
Total title premiums | 858 | 858 | — | ||||||||
Escrow, title-related and other fees | 808 | 695 | 113 | ||||||||
Total title and escrow and other | 1,666 | 1,553 | 113 | ||||||||
Restaurant revenue | 364 | — | 364 | ||||||||
Interest and investment income | 31 | 30 | 1 | ||||||||
Total revenue | 2,061 | 1,583 | 478 | ||||||||
Personnel costs | 623 | 585 | 38 | ||||||||
Other operating expenses | 466 | 372 | 94 | ||||||||
Cost of restaurant revenue | 306 | — | 306 | ||||||||
Agent commissions | 333 | 333 | — | ||||||||
Depreciation and amortization | 100 | 83 | 17 | ||||||||
Title claim loss expense | 51 | 51 | — | ||||||||
Interest expense | 31 | 29 | 2 | ||||||||
Total expenses | 1,910 | 1,453 | 457 | ||||||||
Earnings from continuing operations before taxes | 151 | 130 | 21 | ||||||||
Income tax expense | 50 | 47 | 3 | ||||||||
Earnings from continuing operations before equity investments | 101 | 83 | 18 | ||||||||
(Loss) earnings from equity investments | (1 | ) | 2 | (3 | ) | ||||||
Net earnings | 100 | 85 | 15 | ||||||||
Non-controlling interests | 14 | (1 | ) | 15 | |||||||
Net earnings attributable to common shareholders | $ | 86 | $ | 86 | $ | — | |||||
Cash flows provided by operations | 34 | 27 | 7 | ||||||||
8
FIDELITY NATIONAL FINANCIAL, INC.
CONSOLIDATED SUMMARY OF EARNINGS
(In millions)
(Unaudited)
Three Months Ended | |||||||||||
March 31, 2014 | |||||||||||
Consolidated | Core | FNFV | |||||||||
Direct title premiums | $ | 351 | $ | 351 | $ | — | |||||
Agency title premiums | 404 | 404 | — | ||||||||
Total title premiums | 755 | 755 | — | ||||||||
Escrow, title-related and other fees | 646 | 618 | 28 | ||||||||
Total title and escrow and other | 1,401 | 1,373 | 28 | ||||||||
Restaurant revenue | 354 | — | 354 | ||||||||
Interest and investment income | 29 | 28 | 1 | ||||||||
Realized gains and losses | 2 | 2 | — | ||||||||
Total revenue | 1,786 | 1,403 | 383 | ||||||||
Personnel costs | 649 | 613 | 36 | ||||||||
Other operating expenses | 418 | 399 | 19 | ||||||||
Cost of restaurant revenue | 300 | — | 300 | ||||||||
Agent commissions | 307 | 307 | — | ||||||||
Depreciation and amortization | 117 | 101 | 16 | ||||||||
Title claim loss expense | 53 | 53 | — | ||||||||
Interest expense | 31 | 30 | 1 | ||||||||
Total expenses | 1,875 | 1,503 | 372 | ||||||||
(Loss) earnings from continuing operations before taxes | (89 | ) | (100 | ) | 11 | ||||||
Income tax benefit | (40 | ) | (37 | ) | (3 | ) | |||||
(Loss) earnings from continuing operations before equity investments | (49 | ) | (63 | ) | 14 | ||||||
Loss from equity investments | (31 | ) | — | (31 | ) | ||||||
Net loss from continuing operations | (80 | ) | (63 | ) | (17 | ) | |||||
Earnings from discontinued operations, net of tax | 7 | — | 7 | ||||||||
Net loss | (73 | ) | (63 | ) | (10 | ) | |||||
Non-controlling interests | (51 | ) | (57 | ) | 6 | ||||||
Net loss attributable to common shareholders | $ | (22 | ) | $ | (6 | ) | $ | (16 | ) | ||
Cash flows used by operations | (242 | ) | (195 | ) | (47 | ) | |||||
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9